The largest publicly traded oil and gas company on Thursday released its annual energy outlook. It says the use of hybrids - vehicles that rely on both gas and electricity for power - and other gains in fuel efficiency will keep energy demand in check in the U.S. and other major industrialized countries for years.
Exxon predicts that energy demand will remain flat through 2040 in developed nations.
However, Exxon says that China and other developing nations will continue to increase their thirst for oil and other petroleum based fuels. Energy demand within developing nations is expected to rise nearly 60 percent from 2010 to 2040.
Overall, gains in efficiency will cut fuel consumption and help the global economy. Exxon predicts that from now to 2040, world GDP will grow an average of 2.9 percent per year while energy demand to grow by only 0.9 percent.
Exxon's long-term energy analysis, which was extended this year from 2030 to 2040, paints a picture of a petroleum-reliant world that still has huge untapped reserves underfoot.
The forecast says the boom in the production of natural gas from shale rock formations will spread outside the U.S. to almost every continent. Exxon's projections show the world having enough natural gas trapped in underground rock layers to last 250 years at current consumption levels.
Exxon also expects demand for liquid fuels to rise from about 88 million barrels today to 110 million barrels by 2040. An increasing number of those barrels will come from non-traditional sources such as deepwater fields, Canadian oil sands, natural gas liquids and biofuels.
Meanwhile, power plants will increasingly rely on nuclear energy, natural gas and renewables. Coal use is expected to level off and then decline in coming years.